2009 Country Reports on Terrorism - Panama

United States Department of State, 2009 Country Reports on Terrorism - Panama, 5 August 2010, available at: http://www.refworld.org/docid/4c63b62bc.html [accessed 3 March 2015]

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The presence of the Revolutionary Armed Forces of Colombia (FARC) in Panama's remote Darien Region and potential actions against the Panama Canal remained the main terrorist concerns in Panama. The Government of Panama continued to work with the United States in both areas.

A small, stable number of FARC 57th front members operated in Panama's Darien Province, using the area as a safe haven and drug trafficking base. Darien's dense jungle, sparse population, and lack of significant infrastructure have historically limited the government's presence. As the FARC's drug trafficking in the Darien province increasingly moved inland, new transit routes and logistical supply lines required greater interaction with the local populace, who were often coerced or paid to help. The FARC 57th front was involved in the April 2008 kidnapping of a U.S.-Cuban citizen near Panama City who was held until his release in February 2009. Subsequently, in April, several members of the FARC's 57th front were charged in New York with conspiring to take a U.S. citizen hostage. The Government of Panama also turned over several FARC members to the United States for prosecution in 2009.

The United States and Panama continued to plan for incidents that could potentially shut down transit through the Panama Canal, one of the most strategically and economically important structures in the world. Panama co-hosted the annual PANAMAX exercise, a multinational security training exercise tailored to the defense of the canal. The exercise replicated real world threats, and included specific exercises designed to counter terrorist attacks. Considered the largest operational and foreign military exercise of its kind, the event included 30 ships, a dozen aircraft, and 4,500 personnel from 20 nations. In addition, Panama continued to provide force protection for U.S. military vessels, including submarines, during "high value transits" of the canal.

Panama's Ministry of Government and Justice utilized classroom training, tabletop exercises, and field visits to improve overall counterterrorism coordination among the Panamanian National Police (PPF) agencies. Additionally, several PPF counterterrorism units benefited from the fourth year of counterterrorism training funded by the U.S. Southern Command and provided by U.S. Navy Special Warfare South personnel.

Panama is an important regional financial center and has had one of the fastest growing economies in the Western Hemisphere over the past 15 years. However, the factors that have contributed to Panama's economic growth and sophistication in the banking and commercial sectors – the large number of offshore banks and shell companies, the presence of the world's second-largest free trade zone, the growth in ports and maritime industries, and the use of the U.S. dollar as the official currency – also provide the infrastructure for significant money laundering activity. While Panama took extensive measures to combat money laundering in the banking system, the Colon Free Trade Zone's (CFTZ) significant revenue turnover and cash-intensive transactions left the area vulnerable to money laundering and terrorist financing.[2] In 2009, the CFTZ Authority developed and prepared to launch two projects designed to increase transparency and accountability in the zone: an automated transactions system to replace a manual system that limited effective reporting and analysis; and a compulsory money laundering/terrorist financing on-line training module, required for all companies operating in the zone. The Government of Panama was fully cooperative in reviewing terrorist finance lists.

Panama continued to participate in the Container Security Initiative (CSI) at three ports: Balboa, Manzanillo, and the Evergreen Colon Container Terminal, which was installed in 2009. Additionally, the Department of Energy's Megaports Radiation Portals, which specifically scan for nuclear and other radioactive materials, became functional at the ports of Manzanillo and Balboa, and construction was nearly completed at the ports of Colon and Cristobel.

[2] Articles 287-291 of the Terrorism Financing Act No. 14 of May 2007, which entered into force in 2008 by amending Panama's Criminal Code, set forth provisions for combating terrorism. The act classified terrorism and terrorist financing as independent offenses, with terrorist financing included as a predicate offense to money laundering. Subsequently, in April of 2008 Executive Decree No. 52, referred to as the "New Banking Law," stated that banks and other supervised entities are obliged to establish policies, procedures, and controls on the prevention of money laundering, terrorist finance, and related crimes.